tv Real Money With Ali Velshi Al Jazeera January 24, 2014 3:30am-4:01am EST
only a fraction of the money and jewels stolen was ever recovered. kristin saloomi, al jazeera, new york. break news from egypt. third explosion this time in giza in the haran rvetioan area. many believe it was a hand made device. >> climbing the economic ladder in america, it's easier in some states and harder in others. we will explain. plus across the united states this has not been a good day for mcdonald's but it has been a great one for people who sell natural gas, we'll update you on america's energy emergency. >> in dabo, ali velshi, reports
what the auto industry means for you. are i'm david shuster and this is "real money". this is "real money" and you are the most important part of the show so join our live conversation @aj realmoney. politicians in both parties have been claiming that your odds of moving up the economic ladder are worse. the politicians are wrong, economic mobility is not getting worse, although it's not getting better either. the economic study was published by economists of cal berkeley and harvard. 30-year-olds across the country. while the big picture is stagnant the data shows there are big differences in income
ability based on geography. from a child to rise from a low-income household to high-income how hold, san jose, california, at 12.9%, has some up wardly mobile, and compared to denmark, a country with highest mobility in the world. charlotte, along with atlanta, milwaukee, dayton, ohio and indianapolis, have the lower mobility compared to some developing countries in the world. when you hear broad comments about america's upward mobility, be careful. congressman paul ryan has also conceded, the chances of upward
mobility are terrible. that's true when he talks about his constituents but on average, it has remained about the same for decades. now that's still not an easy pill for most parents who dream of seeing their children, regardless of where they live, seeing growing the economic ladder, that doesn't dmsh the government making -- diminish the government making things more difficult. nayson henry says doesn't mean we've lost the economic dream in general but does bring into question whether that dream ever existed on a national scale to begin with. nathan is an assistant professor of economics from harvard, is it a misnomer to think that americans have upward economic mobile whereas it's been the same as it's been for a long
known? >> it's been well-known that the united states has a lower upward mobility in relation to other places. there is a lot of places in the united states that have some of the lowest rates of upward mobility than have ever been measured. >> what makes the characteristics that put san jose, san francisco, salt lake city at the top of upward mobility? >> we found five strong correlations, five strong factors that were correlated with areas of lier rates of upward mobility. the structure of two parent households, places that have higher rates of civic engagement, also areas that had less residential segregation and greater economic equality. >> a place like atlanta or the lack of social capital are one of the reasons why atlanta for example or indianapolis,
atlanta, some of the other cities, dayton that's why they're at the bottom of the list? >> it's hard to say whether that is causal factor or other things are going on related to upward mobility. as you look across the united states you see areas that have higher rates of residential segregation have lower rates of upward mobility. >> are there policies that come out of this as a result? >> we don't explore the impacts of any particular policies and what we really sought out to try to understand was whether or not tax policies like the earned income tack credit could have a role and we do see moderate potential control. to understand why some of these areas have tremendous high rates of upward mobility and why some areas are poor. >> charlotte is known as a high tech corridor with all the university in that area.
again, what was it about charlotte that put it at the bottom of the list? >> charlotte you could lump in with areas in the southeast. high rates of growth but not high rates of upward mobility for people who were born there. i think that's kind of a surprise to a lot of people. if you look across the country the areas that have high rates of upward mobility are not necessarily the richer areas. there are other areas, strengths of social capital, family ties, other things that are correlated with upward mobility. >> what can i do myself to increase my personal chances of upward mobility what would it be? >> i think education i think is, education and hard work still is at the core of what brings opportunity to people and i think then the broader question is what types of policies can we do to give people better opportunities to kind of realize the fruits of their labors.
>> nathan hendren. it is a fascinating and obviously well researched study. congratulations to you and we appreciate you bringing the information to us on "real money". >> thank you david. >> you're welcome. upward mobility has not declined in a generation do you agree, vicky on facebook says no, anyone with eyes can see the opposite, the middle class vanishing. and the poor. nathan says opportunity exists, hard work and a little luck make it possible. tell us what you think. @ali velshi or @realmoney. a top vc economist, the world's second largest economy
seems to be cooling off. the data this time of year can be pretty unpredictable. the previous study showed strength. in afternoon trading here in new york the dow jones industrial average dropped.01%. if china's economy does not keep growing, companies in key european countries that depend on chinese demand will suffer and a falloff in europe and china could put a very big drag on the united states economy. one american company that just reported a strong finish to 2013 is microsoft. the software and computer giant said over the final three months of last year strong sales of its office software, weak results office sales to individuals. the company's sales have been lagging as consumers increasingly favor tablets over
personal computers. microsoft's struggling tablet, the surface, doubled. microsoft did not mention anything about the search to replace outgoing chief executive steve ballmer. next, the kerry of coca-cola has some insights from davo. carlo go makes an ambition prediction about driverless cars. affecting more than just your heating bill, that story and more as "real money" continues.
based on the weather forecast there may not be much relief in sight. the cold snap on the east part of the country to reach until february 1st. january is on track to be the coldest since 1974. home prices had the smallest monthly gain, extreme weather could affect real estate and the economy even further in jan. according to karl rikodana. karl, explain the effect on the real estate this cold weather has. >> we saw it in the december employment report, there was a big weather dampening effect, no pun intended, sales volumes in the northeast and the midwest we saw declines in the latest round of data. >> and yet you suggest that
those declines, that are just relatively short term, that long term the picture looks good. >> long term the forecast looks good. demands recovering, the are forecast is lumpy on a short term basis if would be buyers are effectively shut in. labor markets are recovering, incomes are recovering and buying is very constructive for the outlook. >> and yet there was that kind of nasty jobs report from december. >> yes, december we saw just 74,000 jobs being created in the economy. >> how do you explain it? >> the number of people impacted by the weather, reduced jobs because of inclement weather was about 100,000. the trend going into that december report was about 200,000 jobs. december was a big hiccup, we
should get some pickup in january but january has been pretty lousy as well, that could be postponed until february. >> the cold weather other than perhaps helping natural gas suppliers or whatnot, is a temporary setback in terms of the economic outlook. >> tourism, housing retail, mort vehicle sales all of those categories tend to be impacted by inclement weather, whether it's hurricanes in the fall or especially winter months we see economic activity being shut in by those weather events. >> congress is supposed to raise the debt ceiling, any fears that the government might come in and put the brakes on things for their dysfunction? >> that would be a risk, we have certainly visited that outcome over the past three years or so. i think because we were able to have a continuing resolution
agreed upon by both houses and both parties and put into place, that funds the government through the end of the fiscal year, up through the end of september. because they already agreed to a budget now they just have to agree to pay for it and they have to pay for it by raising the debt ceiling. i think it should go without a hiccup. they compressed the time more than actually thought. so congress has to come back from recess and really quickly move to raise the debt ceiling. it's an election year, the republicans got clobbered pretty hard in the credit opinion polls in the last fiasco. i don't think they want to risk that again with the election in november. >> what do you think? >> rising rate environment. the fed is not going to raise rates this year but as the labor market continues to mend and inflation continues to tick up,
we have higher inflation rates, a lot of people coming back on who were on the labor market before. that should be in general. >> karl, appreciate you. >> thank you. >> upward mobility in the u.s. has not declined in a generation. do you agree and why? tweet us @alivelshi. or @aljazeera arerealmoney. >> i was sad to learn recently that red lobster is facing financial difficulties. it's in hot water, really. analysts are not sure how the chain will survive. other sit down restaurants are
doing poorly. ruby tuesday is closing 30 of its restaurants. restaurants like pan panera brer smashburger, requirement in the business world, red lobster for the seafood lover in you, needs to produce a new business model. i wish them well. those garlic cheese biscuits are one of a kind. that's "real money". i'm david shuster, thanks for joining us.